Industry Watch: Flowing value into your transformation

Every hundred years or so, it seems, we enter some new industrial age, and the way business works must change along with it. The Industrial Revolution led to the Age of Oil, followed by the Atomic Age and now we’re in the middle of a Digital Revolution.

Change is always exciting, but painful, as companies that are not built to work in these new ways struggle to keep pace with the future. As project managers at last-revolution companies transition to this new digital world, the methods and processes they use must change.

Mik Kersten, CEO at DevOps software tools company Tasktop, has written a book called “Project to Product: How to Survive and Thrive in the Age of Disruption with the Flow Framework.” He says the key thing that organizations need to do is switch from focusing on projects to a product-oriented paradigm, and create an infrastructure to measure value against time spent creating the product and user satisfaction. “You have to look at business value from a customer point of view,” he says.

In the earlier days, a company could manufacture a product, or work 18 months on a software release, and that was measurable. In today’s rapid delivery, cloud-based environment, he says, “You have to be able to build software sufficiently and at scale, and enterprise IT organizations haven’t learned to do it.” Part of the reason is that until now, the industry has not been able to agree on how to define a unit of productivity in software delivery. Metrics for measuring value delivery have been rooted in manufacturing, but don’t apply to software development. “There’s great ideas in manufacturing, great ideas in lean, but things are different in software. You’re not producing the same widget over and over, and your product development — your creative cycle of design and entering the market and production cycle — aren’t the same,” he said.

Furthermore, Kersten says that right now, organizations are using the wrong metrics — proxy metrics. “The common one in Agile is how Agile am I, how many people have been trained on Scrum. That tells you nothing. It’s good to have people trained on Scrum, but you don’t know if you’re delivering more value.”

Another problem is that to truly enhance flow, efforts must be made to clear bottlenecks, but those are often hard to identify in complex, large enterprises. Continuous integration and delivery are good ideas, but putting resources there when it’s not a bottleneck is wasting company resources, he says. Organizations “assume if they hire more developers and implement Jenkins and Puppet, that they will have more throughput. But is that where the bottleneck is? Maybe it’s having great screens and mobile apps. Maybe the bottleneck is they don’t have enough designers.”

In the book, Kersten defines four areas of value: features, defects, risks and debts. “Each represent work that being done at a course level… it might be architecture work, or API work. But at a business level, these things are just collectively exhaustive. All work is one of these, and they’re mutually exclusive. If you’re telling your team to focus on GDPR this quarter, you cannot expect the same rate of flow of features. Or you’re trying to get to a 1.0 release, you’re trading off technical debt that you’ll have to pay down at some point.”

Companies like Facebook, Amazon, Apple, Netflix and Google (the FAANGs, Kersten calls them) already get this. As an example, Kersten says Microsoft “has 3,500 people working in their development division making the tools for the network. Microsoft has its own file system for Git. The FANGs have already done this and it’s their competitive differentiator.”

So, he continues, “Either we can be happy giving them more and more of the world economy, or for the rest of these organizations, we need a way of creating that without having to invest the half-billion dollars a year in tooling development.”

Tasktop’s Flow Framework was created to give a common language to technical and non-technical people to help organizations start with end-to-end flow and to start with thinking how it drives business results. Version 1.0 will be introduced at the DevOps Enterprise Summit in Las Vegas in October.

All of this is just about business value from a customer point of view. They want the new features, they want a product that will keep their information secure. That’s where the value lies.